Currency and Metals could be the big movers early in 2020

Trump is doing his trade thing with China, and part of the 2020 agreement will be a resolution of the US dollar.
A weaker US dollar is on the table, as it helps both Trump and Xi. The COT reports gives us a huge hint this is about to happen early in 2020.

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Chart from the video

Lyn Alden makes a great point in this thread about the Dec 2019 repo news.

For years, large U.S. banks were drawing down cash levels (15% to 7% of assets in last 5yr) to buy treasuries (from 15% to 21% of assets). But now they are basically at regulatory limits; can't draw down cash to buy more treasuries. So, the Fed became the new buyer of them.

and ..

A lot of people think the Fed is trying to support the equity market, or covering for a bank/fund failure somewhere. Those explanations are possible, but not required. The Fed simply taking over as the primary financier of U.S. deficits is a mathematically sufficient reason.

Luke Gromen sums up the argument for a lower US dollar.

It is election year in the USA and to stimulate into Nov 2020 he needs a economic boost. Trump can not get tax cuts, or infrastructure spending out of congress, he is left with the FED balance sheet and a lower US dollar. They are about to step up big time.





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